Tag Archives: rentals

While statistics on the gap in affordable housing clearly indicate the magnitude of the problem, they mask the extent of the difficulties that certain low-wage workers often face in obtaining a unit they can afford, particularly in major metro areas.

Making sense of the story

Data from the Bureau of Labor Statistics indicate that in many markets, most full-time cashiers, retail and sales persons, and food preparation workers would have been unable to afford even a modest one-bedroom apartment.

The fair market rent of a two-bedroom apartment was even further out of reach for these workers: as high as $2,062 in San Francisco and over $1,400 Washington, DC, Boston, New York, and Los Angeles.

Other occupations where median annual wages were inadequate for households to afford a
modest one-bedroom apartment include—but are not limited to—EMTs and paramedics,
childcare workers, security guards, and several types of healthcare support occupations.

All of these jobs are vital to local economies, and support a variety of businesses and services required for healthy, growing communities.

Wage stagnation among low-income households is certainly part of the problem. Between 2001 and 2014, the median real household income for renters in the bottom quintile fell 9.9 percent, while income for households in the top quintile was up 3.1 percent.

To make ends meet, many low-wage households must reduce expenditures on food and
healthcare, move to areas which are less accessible and require longer commute times, or double up with family or roommates.

Nearly a third of the nation’s 7 million renters earning less than $35,000 in 2014 had minors
living at home, and fully half of these families reported being severely cost-burdened in the same year—paying more than half of their incomes for housing.

“New apartments hitting the rental market in 2016 are 8% smaller than they were 10 years ago, according to a recent report from online rental marketplace RentCafe.

“Meanwhile, rents for all apartments on the market have risen 7% in the last five years.

“This year, the average square footage of all new apartments, including studios, one-bedroom and two-bedroom apartments, was 934 square feet. Just a decade ago, the new units coming online offered an average of 1,015 square feet.

“The national average for rent this year is $1,296 compared to $977 in 2011…”

As the Housing Recovery Strengthens, Affordability and Other
Challenges Remain: Harvard Study

Source: Harvard

The national housing market has now regained enough momentum to provide an engine of growth for the US economy, according to The State of the Nation’s Housing report released this week by Harvard’s Joint Center for Housing Studies. However, several obstacles continue to hamper the housing recovery—in particular, the lingering pressures on homeownership, the eroding affordability of rental housing, and the growing concentration of poverty.

Making sense of the story

On the renter side, the number of cost-burdened households rose by 3.6 million from 2008 to 2014, to 21.3 million. Even more troubling, the number with severe burdens (paying more than 50 percent of income for housing) jumped by 2.1 million to a record 11.4 million.

The national homeownership rate has been on an unprecedented 10-year downtrend, sliding to just 63.7 percent in 2015. Tight mortgage credit, the decade-long falloff in incomes that is only now ending, and a limited supply of homes for sale are all keeping households—especially first-time buyers—on the sidelines.

The report finds that income inequality increased over the past decade, with households earning under $25,000 accounting for nearly 45 percent of the net growth in US households in 2005–2015.

The report finds that rent burdens are increasingly common among moderate-income households, especially in the nation’s 10 highest-cost housing markets, where three-quarters of renters earning $30,000–45,000 and half of those earning $45,000–75,000 paid at least 30 percent of their incomes for housing in 2014.

Federal assistance reaches only a quarter of those who qualify, leaving nearly 14 million
households to find housing in the private market where low-cost units are increasingly scarce.

Low-income households with cost burdens face higher rates of housing instability, more often settle for poor-quality housing, and have to sacrifice other needs—including basic nutrition, health, and safety—to pay for their housing.

The report notes that a lack of a strong federal response to the affordability crisis has left state and local governments struggling to expand rental assistance and promote construction of affordable housing in areas with access to better educational and employment opportunities.

Real estate and cars aren’t the only things you can either rent or buy; there are plenty of other rent-able things that you might not have thought about:

Tools – Perfect for when you have a DIY home improvement project, but probably won’t need that specific tool for anything else. Rent a chop saw for the crown molding in the bedroom, a chainsaw for the dead tree in the backyard, or a seeder to reseed your front lawn. Rent from local stores around you or Home Depot or Lowe’s, or see if a neighbor or friend has the necessary tool that you might be able to borrow.

Chickens and coops – Self-sufficiency can be a fun project or a lifetime endeavor; either way, with multiple companies with coops and chickens for rent, you can try out “home grown” eggs! Check out sites like rent-a-chicken.net, rentthechicken.com, or rentacoop.com.

Art – Does looking at the same painting on your living room wall get boring after awhile? TurningArt.com allows you to continually rotate artwork for a monthly fee.

Some new laws to note for 2016

Mold(SB 655)
Mold must be cleared from any rentals or criminal penalties could be filed against the landlord. A health department official must visit the property and declare it unfit to qualify for filing court charges against the landlord. Law also says the tenant could be liable if was their fault due to inappropriate housekeeping practices.

Clotheslines(AB 1448)
Landlords and homeowner associations must allow renters or residents to put up a line or rack to dry their clothes. They can not attach it to the building without the Home Owner association or landlord’s permission.

Pesticides(SB 328)
Landlords must tell residents 24 hrs before application, what pest is being sprayed, what kind is being used, and alert to warnings about the toxicity of the product.

Fake Grass(AB 349)
Home Owner Association Guidelines are no superseded to allow homeowners to put in artificial turf, rocks, or something else that doesn’t need as much water, like cacti.

Renters are looking a little older these days.

There’s tough competition in the rental market these days, with more people becoming renters. And steep prices make renting instead of buying not always the most economical decision. According to CNN Money, here is what’s going on in the rental market:

“Rental applicants tend to conjure up images of recent college grads looking to start their life in the real world. But Millennials are facing increased competition from people who have already spent decades in adulthood, and may have better credit and higher income.

“Since 2005, there has been an uptick in renters, with people in their 50s and 60s making up the largest chunk of the increase, according to a recent report from the Harvard Joint Center for Housing Studies.

With such high competition and prices in the rental market, it might be time for you to consider buying a home. Please give me a call to see if becoming a San Diego County homeowner would make sense for you: (619) 890-3648!

A good rental history can help borrowers

First-time home buyers planning to purchase a house later this year may have a better chance of qualifying for a mortgage if they have had a history of paying their rent on time.

Last year, credit-reporting agency Experian added a section to millions of credit reports showing on-time rent payments and raised the credit scores of many people. The company said that this year it would add in negative marks, including mentions of bounced checks or of tenants’ leaving before a lease was up.

Incorporating rental payments into credit scores could affect millions of people who have not established credit histories through credit cards, student loan repayments, and other credit sources.

Almost half of consumers considered “high-risk” experienced an increase of 100 points or more after their positive rental history was added, according to Experian’s rent bureau. Those with average or higher scores did not experience major movement.

Although it is still too early to show the effects of the new credit report, which began in December, the changes are intended to allow lenders and consumers to have greater transparency, according to Corelogic.

People who have lost their homes to foreclosure and are now leasing may be able to rebuild their credit histories by being responsible renters.

However, consumer groups and advocates are skeptical, noting that reports are sometimes riddled with mistakes and some landlord-tenant disputes may be difficult to capture in a credit report. Rent may not have been paid, for example, because the furnace was left unrepaired for months.

Read the article, from which these points were taken, from the New York Times.

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About John A Silva

As your local real estate adviser in the area of San Diego County with over 28 years of experience, my goal is to provide you with relevant local housing market information, tips, and advice.

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